Perpustakaan Digital ITB

The understanding the innate characteristic of goods and service in drinking water supply provision leads to the implementation of drinking water supply chain management for water supply provision. This chain covers all activities related to the cycle of water which starting from securing raw water sources, water abstraction from natural environment (surface and/or groundwater), the production of drinking water and the distribution drinking water to the customer. Furthermore, the chain continues with the collection and transportation of wastewater, treatment and discharge back it into the natural environment (surface and/or groundwater). This research provides a comparative study and analysis of the Netherlands and Indonesia related to the implementation of drinking water supply chain management and the influence of privatization and decentralization to its institutional arrangements. The elements that analyzed are the adoption of drinking water chain and the influence of privatization and decentralization on the institutional arrangements of drinking water supply chain, i.e: separation of owner and provider, autonomy of utilities, adoption of competitive discipline, and adoption of cost recovery for the service. The two countries have differently adopted the concept of drinking water supply chain and respond to the influence of privatization and decentralization. The Netherlands have implemented the drinking water supply chain for the provision of drinking water since around 1930 while Indonesia since 2004. As the result, the performance of drinking water supply provision in the Netherlands is categorized as good. The response for privatization and decentralization also are different. The Netherlands sees privatization just as an idea for increasing efficiency of the activities along the chain rather than delegating the monopoly to the private sector. Indonesia sees that privatization more as the opportunities to increase investment for extending coverage of the service. In the context of decentralization, the two countries adopted decentralization in managing the drinking water supply chain. From similarities and differences in adopting the concept of drinking water supply chain management, privatization and decentralization, some lesson learnt are withdrawn for Indonesia in order to improve the performance of the drinking water supply provision. Some lessons learnt that taken from the Netherlands are: 1. Specific and integrated legislation for drinking water supply chain, 2. Privatization as adoption of commercial principles, 3. Managerial autonomy of drinking water supply company and 4. The multi-institution coordination in drinking water supply chain. Based on lessons learnt and the contextual condition of Indonesia, there are some recommendation to improving the management of drinking water supply chain in Indonesia, they are: 1. Creating specific legislation for drinking water supply chain management, 2. Strengthen public sector for managing drinking water supply chain and the adoption of commercial principle, 3. Increasing local government cooperation for increasing managerial autonomy of water supply company, 4. Increasing awareness of communities on drinking water supply chain management and building mechanism for coordination in managing drinking water supply chain.